Question 1

An increase in demand for highly skilled workers is a result of:

Accepted Answer

A)  increases in labor cost. 
B)  advancements in technology. 
C)  a higher minimum wage. 
D)  increases in international trade. 
A)  increases in labor cost. 
B)  advancements in technology. 
C)  a higher minimum wage. 
D)  increases in international trade.

Question 2

The marginal physical product of labor is a short-run concept because:

Accepted Answer

A)  labor is fixed. 
B)  all inputs except labor are fixed. 
C)  labor is variable. 
D)  all inputs except labor are variable. 
A)  labor is fixed. 
B)  all inputs except labor are fixed. 
C)  labor is variable. 
D)  all inputs except labor are variable.

Question 3

A _____ is a refusal to work by members of a labor union.

Accepted Answer

A)  negotiation 
B)  backdoor compromise 
C)  demand tradeoff 
D)  strike 
A)  negotiation 
B)  backdoor compromise 
C)  demand tradeoff 
D)  strike

Question 4

When an employer is a monopsony that is driving wages _____ competitive levels, a labor union may serve to counteract the monopsonist's market power by driving wages:

Accepted Answer

A)  below; lower. 
B)  above; higher. 
C)  below; higher. 
D)  above; lower. 
A)  below; lower. 
B)  above; higher. 
C)  below; higher. 
D)  above; lower.

Question 5

The demand for labor is determined by the labor's:

Accepted Answer

A)  marginal revenue product. 
B)  marginal physical product. 
C)  total product. 
D)  total revenue. 
A)  marginal revenue product. 
B)  marginal physical product. 
C)  total product. 
D)  total revenue.

Question 6

(Figure: Labor in a Competitive Market A) In the figure, if the firm hires two workers, the price of labor at equilibrium is:

Accepted Answer

A)  $150. 
B)  $300. 
C)  $450. 
D)  $600. 
A)  $150. 
B)  $300. 
C)  $450. 
D)  $600.

Question 7

(Figure: MPP and MRP) Unit Price = $5
In the table, what is the marginal revenue product of the fourth worker?
 $\begin{array}{|l|l|l|l|l|}
 \hline\text { Labor } & \text { Total } & \mathrm{MPP}_{L} &\text { Total } & \mathrm{MRP}_{L}  \
& \text { Product } & & \text { Revenue } & \
& \text { (Q) } & & \text { (TR) } &\
 \hline & 35 & 35 & ? & \$ 175 \
\hline 2 & 75 & 40 & ? & \$ 200 \
\hline 3 & 105 & 30 & \$ 525 & ? \
\hline 4 & 130 & 25 & \$ 650 & ? \
\hline 5 & 150 & 20 & \$ 750 & ?\
\hline
\end{array}$

Accepted Answer

A)  $100 
B)  $125 
C)  $150 
D)  $650 
A)  $100 
B)  $125 
C)  $150 
D)  $650

Question 8

_____ involves equating the marginal revenue product of each resource to the _____ of that resource.

Accepted Answer

A)  The marginal physical product; cost 
B)  Profit minimization; price 
C)  Price; cost 
D)  Profit maximization; price 
A)  The marginal physical product; cost 
B)  Profit minimization; price 
C)  Price; cost 
D)  Profit maximization; price

Question 9

_____ is the offering of different job opportunities or pay to different employees on the basis of characteristics such as race, age, gender, or sexual orientation.

Accepted Answer

A)  Compensation differential 
B)  Discrimination in labor markets 
C)  Willingness to pay 
D)  Labor demand 
A)  Compensation differential 
B)  Discrimination in labor markets 
C)  Willingness to pay 
D)  Labor demand

Question 10

When marginal revenue declines with additional output, the labor demand curve:

Accepted Answer

A)  slopes upward. 
B)  slopes downward. 
C)  shifts to the left. 
D)  shifts to the right. 
A)  slopes upward. 
B)  slopes downward. 
C)  shifts to the left. 
D)  shifts to the right.

Question 11

Which of the following is an example of physical capital?

Accepted Answer

A)  rental income 
B)  labor 
C)  a corporate bond 
D)  machinery and equipment 
A)  rental income 
B)  labor 
C)  a corporate bond 
D)  machinery and equipment

Question 12

Lawmakers have attempted to address discrimination in the labor market by passing laws such as the Equal Pay Act of 1963, the Civil Right Act of 1964, and the _____ Act of 2009.

Accepted Answer

A)  National Labor Relations 
B)  Wagner 
C)  Clayton 
D)  Lilly Ledbetter Fair Pay 
A)  National Labor Relations 
B)  Wagner 
C)  Clayton 
D)  Lilly Ledbetter Fair Pay

Question 13

(Figure: MPP and MRP) Unit Price = $5
In the table, what is total revenue if 2 workers are hired?
 $\begin{array}{|l|l|l|l|l|}
 \hline\text { Labor } & \text { Total } & \mathrm{MPP}_{L} &\text { Total } & \mathrm{MRP}_{L}  \
& \text { Product } & & \text { Revenue } & \
& \text { (Q) } & & \text { (TR) } &\
 \hline & 35 & 35 & ? & \$ 175 \
\hline 2 & 75 & 40 & ? & \$ 200 \
\hline 3 & 105 & 30 & \$ 525 & ? \
\hline 4 & 130 & 25 & \$ 650 & ? \
\hline 5 & 150 & 20 & \$ 750 & ?\
\hline
\end{array}$

Accepted Answer

A)  $175 
B)  $200 
C)  $375 
D)  $525 
A)  $175 
B)  $200 
C)  $375 
D)  $525

Question 14

The _____ Act is the law that allows workers to form labor unions through democratic elections, allows unions to strike, and requires employers to bargain in good faith with unions.

Accepted Answer

A)  National Labor Relations 
B)  Sherman 
C)  Federal Trade Commission 
D)  Clayton 
A)  National Labor Relations 
B)  Sherman 
C)  Federal Trade Commission 
D)  Clayton

Question 15

When the price of the firm's product increases, marginal revenue obtained from selling additional units _____, which _____ marginal revenue product of labor (MRPL).

Accepted Answer

A)  increases; decreases 
B)  decreases; increases 
C)  decreases; decreases 
D)  increases; increases 
A)  increases; decreases 
B)  decreases; increases 
C)  decreases; decreases 
D)  increases; increases

Question 16

Which of the following is an example of physical capital?

Accepted Answer

A)  rental income 
B)  labor 
C)  corporate stock 
D)  buildings 
A)  rental income 
B)  labor 
C)  corporate stock 
D)  buildings

Question 17

(Figure: MPP and MRP) Unit Price = $5
In the table, what is total revenue if 1 worker is hired?
 $\begin{array}{|l|l|l|l|l|}
 \hline\text { Labor } & \text { Total } & \mathrm{MPP}_{L} &\text { Total } & \mathrm{MRP}_{L}  \
& \text { Product } & & \text { Revenue } & \
& \text { (Q) } & & \text { (TR) } &\
 \hline & 35 & 35 & ? & \$ 175 \
\hline 2 & 75 & 40 & ? & \$ 200 \
\hline 3 & 105 & 30 & \$ 525 & ? \
\hline 4 & 130 & 25 & \$ 650 & ? \
\hline 5 & 150 & 20 & \$ 750 & ?\
\hline
\end{array}$

Accepted Answer

A)  $35 
B)  $150 
C)  $175 
D)  $200 
A)  $35 
B)  $150 
C)  $175 
D)  $200

Question 18

Identify and discuss two principles that are used by firms in deciding how many workers to hire.

Accepted Answer

First, firms must pay attention to the r

Question 19

A worker's wages will increase to the point where:

Accepted Answer

A)  profits equal the price of labor. 
B)  marginal revenue product equals the price of labor. 
C)  revenue equals costs. 
D)  marginal revenue product equals costs. 
A)  profits equal the price of labor. 
B)  marginal revenue product equals the price of labor. 
C)  revenue equals costs. 
D)  marginal revenue product equals costs.

Question 20

_____ is the total compensation that an employee receives from working.

Accepted Answer

A)  The price of labor 
B)  The marginal revenue product 
C)  The wage 
D)  Take-home pay 
A)  The price of labor 
B)  The marginal revenue product 
C)  The wage 
D)  Take-home pay

Exam 17: Labor and Other Resources

An increase in demand for highly skilled workers is a result of:

The marginal physical product of labor is a short-run concept because:

A _____ is a refusal to work by members of a labor union.

When an employer is a monopsony that is driving wages _____ competitive levels, a labor union may serve to counteract the monopsonist's market power by driving wages:

The demand for labor is determined by the labor's:

(Figure: Labor in a Competitive Market A) In the figure, if the firm hires two workers, the price of labor at equilibrium is:

(Figure: MPP and MRP) Unit Price = $5 In the table, what is the marginal revenue product of the fourth worker? Labor Total Total Product Revenue (Q) (TR) 35 35 ? \ 175 2 75 40 ? \ 200 3 105 30 \ 525 ? 4 130 25 \ 650 ? 5 150 20 \ 750 ?

_____ involves equating the marginal revenue product of each resource to the _____ of that resource.

_____ is the offering of different job opportunities or pay to different employees on the basis of characteristics such as race, age, gender, or sexual orientation.

When marginal revenue declines with additional output, the labor demand curve:

Which of the following is an example of physical capital?

Lawmakers have attempted to address discrimination in the labor market by passing laws such as the Equal Pay Act of 1963, the Civil Right Act of 1964, and the _____ Act of 2009.

(Figure: MPP and MRP) Unit Price = $5 In the table, what is total revenue if 2 workers are hired? Labor Total Total Product Revenue (Q) (TR) 35 35 ? \ 175 2 75 40 ? \ 200 3 105 30 \ 525 ? 4 130 25 \ 650 ? 5 150 20 \ 750 ?

The _____ Act is the law that allows workers to form labor unions through democratic elections, allows unions to strike, and requires employers to bargain in good faith with unions.

When the price of the firm's product increases, marginal revenue obtained from selling additional units _____, which _____ marginal revenue product of labor (MRPL).

Which of the following is an example of physical capital?

(Figure: MPP and MRP) Unit Price = $5 In the table, what is total revenue if 1 worker is hired? Labor Total Total Product Revenue (Q) (TR) 35 35 ? \ 175 2 75 40 ? \ 200 3 105 30 \ 525 ? 4 130 25 \ 650 ? 5 150 20 \ 750 ?

Identify and discuss two principles that are used by firms in deciding how many workers to hire.

A worker's wages will increase to the point where:

_____ is the total compensation that an employee receives from working.

The Basics of Economics

Why We Trade

The Supply and Demand Model

Elasticity

Consumer Choice

The Economic Efficiency of Markets

Taxation: An Economic Analysis

Externalities, the Environment, and Public Goods

Organizing a Business

Stocks and Bonds

The Cost of Doing Business

Perfect Competition

Monopoly and Antitrust Laws

Monopolistic Competition and Price Discrimination

Oligopoly

Behavioral Economics and Strategy

The Distribution of Income

Information and Health Economics

GDP and the Price Level

Unemployment and the Business Cycle

Long Run Economic Growth

Saving, Investment, and the Federal Budget Deficit

The Monetary System

Money and the Price Level in the Long Run

Aggregate Supply and Aggregate Demand

Monetary Policy and Interest Rates

Fiscal Policy and the Business Cycle

The Aggregate Expenditure Model

Inflation Expectations and Stabilization Policies

International Trade

Foreign Exchange Markets

International Finance

Filters

_ involves equating the marginal revenue product of each resource to the _ of that resource.

When the price of the firm's product increases, marginal revenue obtained from selling additional units _, which _ marginal revenue product of labor (MRP_L).